StrategyMarch 21, 2026·8 min read
How to Size Your Positions Like a Pro
BT
BookieTrading AI Research Team
AI-generated analysis • Educational purposes only
The difference between amateur and professional traders often isn't stock selection — it's position sizing. Here's a framework that actually works.
The 5% Rule A simple framework: **never put more than 5% of your portfolio in any single position at entry.** This means a single position going to zero costs you 5% — painful but survivable. For volatile assets like individual altcoins, consider **2-3% maximum**. ## The Math of Recovery - Down 25% requires a 33% gain to break even - Down 50% requires a 100% gain to break even - Down 75% requires a 300% gain to break even **Losses are asymmetric.** Cut them early. ## Summary 1. **Max 5% per position** at entry 2. **Scale in** — don't build full positions immediately 3. **Set stop losses** before entry 4. **Cut losses at 15-20%** from entry *This is educational content, not financial advice.*
⚠️ Educational Content Only. This article is AI-generated for informational and educational purposes. It does not constitute financial advice, investment advice, or a recommendation to buy or sell any security or digital asset. Always conduct your own research and consult a qualified financial advisor before making investment decisions.
Category:Strategy